The fierce clashes in the town, located some 90 miles (140 kilometers) southeast of Tripoli, comes as the Libya's new leaders struggle to stamp out lingering resistance from pro-Gadhafi forces and unify a deeply fractured country after eight months of civil war and more than 40-years of authoritarian rule.

Mahmoud al-Warfali, a spokesman for revolutionary brigade in Bani Walid, said up to 150 pro-Gadhafi fighters raised the old green Libyan flag at the northern gate of the town and were battling revolutionary forces in the streets with rocket-propelled grenades and AK-47s.

"These are Gadhafi remnants who tried to take over the city," al-Warfali said. "They have tried to do this before and take over the interim government's office, but thank God we have been able to fight them off."

He said four revolutionary fighters have been killed. He did not know how many people had been wounded.

Bani Walid resident Moussa al-Warfali said the clashes began early Monday when Gadhafi loyalists angry over the arrest of one of their men attacked revolutionary fighters in the town.

The fighting originally was centered around the revolutionary brigade's base, but has since spread to other parts of the town.

The clashes are considered serious enough that dozens of revolutionary fighters from Tripoli have been dispatched to Bani Walid to help, said brigade commander Saddam Abdel-Zein.

Bani Walid has long tormented Libya's revolutionaries.

After the fall of Tripoli to anti-Gadhafi fighters in August, regime loyalists found refuge in the town, and from there held off revolutionary forces for weeks, using the surrounding mountains and valleys to their advantage to pick off revolutionary forces.

Even after Gadhafi's capture and killing in October, the city and its surrounding region have troubled Libya's new leaders.

In November, 15 soldiers were killed in an ambush by Gadhafi loyalists just outside the town. And revolutionary fighters in Bani Walid have complained that the country's interim government has done little to help secure the city.